HomeMost Popular Booking Holdings: The Gem...

Booking Holdings: The Gem in the Financial Jungle Booking Holdings: The Gem in the Financial Jungle

Actionable Trade Ideas

always free

FOREX graph hologram, aerial night panoramic cityscape of Bangkok, the developed location for stock market researchers in Asia. The concept of fundamental analysis. Double exposure.

I have identified a stellar global stock with outstanding growth and profitability potential for the upcoming year. My top pick for 2024 is the premier online travel booking provider globally, acknowledged for its exceptional brand recognition and a diversified portfolio of companies. With its cutting-edge AI Trip Planner, Booking integrates the travel planning experience using a travel Chatbot and a visual list of destinations. This vision is the next step in their ongoing journey to enhance the entire trip planning process, according to CEO Glenn Fogel.

While past performance cannot guarantee future results, my top stock pick for 2023, Super Micro Computer (SMCI), has continued to outperform, demonstrating exceptional value and growth, with an impressive rise of over 294% since my initial pick in January 2023.

Booking Holdings Inc. (NASDAQ:BKNG) Stock Overview

  • Market Capitalization: $118.9B

  • Quant Rating: Strong Buy

  • Quant Sector Ranking (as of 1/8/2024): 15 out of 530

  • Quant Industry Ranking (as of 1/8/2024): 3 out of 38

Booking Holdings, Inc. (BKNG) presents itself as the world’s leading online travel provider with a vast network of local partners across more than 220 countries and territories. Its solid financials, emphasis on customer service, investment in technology, and expansion into new countries and vacation rentals have contributed to an increasing user base. Strong leisure travel demand led to Booking’s surge in customer bookings of $40B for Q3 2023, a year-over-year increase of 24%.

β€œI’m encouraged by the strong results we are reporting today and by the strong leisure travel demand environment that we continue to see. In the third quarter, our traveler customers booked 276 million, or more than a quarter of a billion room nights, which was an increase of 15% year-over-year, and we had gross bookings of $40 billion, which was an increase of 24% year-over-year,” said CEO Glenn Fogel.

Tapping into multiple travel segments, Booking’s six primary consumer-facing brands include Booking.com, Priceline, Agoda, Rentalcars.com, KAYAK, and OpenTable. Besides these renowned names, BKNG operates a network of value subsidiaries like Cheapflights, Fareharbor, and Rocketmiles, enhancing its presence in Europe and Asia-Pacific.

In addition to its strong global presence, BKNG also showcases robust fundamentals, evident in its A’s in growth, profitability, momentum, and consensus earnings revisions, with an overall Quant Rating of 4.87. BKNG is one of the most profitable companies in its sector, with an A+ for Profitability and an β€˜A’ Growth Grade, according to Seeking Alpha Factor Grades.

Profitability

BKNG has secured an A+ Profitability Factor Grade, highlighted by a gross profit margin of 86%, significantly exceeding the sector median. The company has consistently delivered a gross profit margin of at least 80% over the last five quarters and 8 of the last ten. In addition, BKNG outperforms the sector median in operating margin, net income, return on total capital, and return on total assets. Its remarkable 348% return on equity is nearly 30 times higher than the sector median of 11.4%. These numbers indicate the efficient utilization of shareholder investments and capital. Booking has chosen to invest cash in growing the business and boosting margins instead of awarding dividends.

BKNG has surpassed EPS targets in 11 of the past 12 quarters, with its most recent quarter’s EPS of $72.32 beating consensus estimates by $4.40, while revenue of $7.34B exceeded the target by $80M. BKNG’s Q3 earnings beat was among the top upside EPS surprises.

Growth

Booking is strategically positioned to exploit the global online travel market’s potential growth, projected to reach $1.56 trillion in 2030, with technological advancements such as AI-enabled Connected Trip vision. During the Q3 Earnings Call, Fogel highlighted,

β€œWe have always envisioned AI technology at the center of the Connected Trip, and we have a long history of investing in AI technology and incorporating it in our platforms across our company. I previously spoke about the hard work our teams have been doing to

Swing Trading Ideas and Market Commentary

Need some new swing ideas? Get free weekly swing ideas and market commentary from Jonathan Bernstein here: Swing Trading.

Explore More

Weekly In-Depth Market Analysis and Actionable Trade Ideas

Get institutional-level analysis and trade ideas to take your trading to the next level, sign up for free and become apart of the community.